When it comes to the debate around sprawl, intensification and housing affordability one of the most persistent arguments for opening up more greenfield land is that land costs at the edge of town are much cheaper and therefore opening it up for development can help in making houses more affordable. We’ve long argued that the looking at the costs of housing alone is only telling one part of the story and that we really should also be taking transport costs into account.
An article in the herald yesterday highlighted that a study on exactly that based on Auckland that had just been published (you’ll need to purchase the paper to be able to read it). The herald writes about it.
Migrating to the outer suburbs may not be the affordable dream many Aucklanders believe, according to a new study which lays bare the true cost of commuting.
Researchers have for the first time created a detailed picture of housing affordability in New Zealand’s largest city when commuting costs are factored in, with surprising results.
One calculation showed that the most affordable homes could even be found in some inner areas of the city.
“When you take into account that people in outlying areas are so much more dependent on automobiles than people in inner-city neighbourhoods, transport costs should play a role in what locations we consider to be affordable or not,” study co-author Kerry Mattingly said.
The researchers created two separate income-based indicators to measure combined commuting and housing affordability across different suburbs of Auckland.
This stands in stark contrast to measures considering housing costs in isolation, which show affordability generally improves with distance from the centre of the city.
One of the indicators, which they said presented a more accurate picture of how affordable an area would be for a typical family to live in, found the most affordable areas were found in the lower central, inner-west and inner-south of Auckland.
Areas close to employment hubs appeared relatively more affordable using the measure due to modest expenditure on commuting.
In some peripheral areas, average annual commuting costs could be five times the amount shouldered by those living in many central Auckland neighbourhoods.
The study highlights that there’s no point in just building a heap more housing out on the urban fringe as that alone won’t make housing more affordable primarily due to people having to drive further. To me this result is completely unsurprising and shows we need to be much smarter about how we develop out city if affordability is something that people are actually concerned about.
Amazingly I have seen some people suggest that without having read it, the study is flawed because it focuses only on people travelling to the CBD however actually reading through the paper shows that this completely false. Using the 2006 census data the researchers looked at individual area units within Auckland, where the people within them were travelling to for work and what mode they used. That means someone travelling to the CBD is treated exactly the same as someone travelling to a different part of Auckland.
Yet despite how detailed the researchers have been there are a still factors that haven’t been taken into account that would likely further impact on affordability. For example parking costs aren’t taken into account and the calculations only take into account the distance travelled, not the time travelled. Both of these are likely to further favour areas where there good PT, walking and cycling connections.
Here’s one of the maps showing housing affordability compared to median income however once again you’ll need to buy the paper to see all of them.
“If you just look at housing costs alone, outlying areas appear really affordable and it initially seems to make sense to say, hey, let’s open up greenfield sites on the urban periphery and develop here,” Mr Mattingly said. “But when you include these broader costs, they are not as affordable as they seem.”
He said the results went against the traditional notion of “drive ’til you qualify”.
When wider social impacts such as increased pollution were taken into account, low-density, urban-fringe expansion was even less ideal, he said.
While increasing the supply of housing may well help to lower the cost of housing, Mr Mattingly said it was the way in which supply was improved that was important.
“In particular, the location and density of residential development will have strong implications for associated transportation costs, combined housing and transport affordability, and long-term environmental sustainability.”
Policy-makers needed to consider the relationship between housing and transport, and strike a balance between an adequate supply of land for development and intensification.
It’s certainly an interesting paper and something I’ve wanted to see more data on for a while so thank to the authors for doing this. The timing is also good being just before the unitary plan submissions close.